Home Equity Loan

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Related to Home equity loans: Home Equity Line of Credit

Home Equity Loan

A loan in which the one borrows against the value of one's home. That is, the collateral of a home-equity loan is one's house. The amount in these loans is generally the difference between the homeowner's equity in the house and the market value of the house. The homeowner receives the amount of the loan in a lump sum, and may use it to finance other purchases or ventures. If a home-equity loan is not paid off, the lender may take possession of and sell the house in order to pay for the loan; this can occur even if the homeowner continues to make payments on his/her mortgage. These loans generally have variable interest rates, which are nonetheless still lower than most other lines of credit. Home-equity loans are sometimes called second mortgages or equity loans. See also: Reverse mortgage.

Home equity loan.

A home equity loan, sometimes called a second mortgage, is secured by the equity in your home.

You receive the loan principal, minus fees for arranging the loan, in a lump sum. You then make monthly repayments over the term of the agreement, just as you do with your first, or primary, mortgage.

The interest rates on home equity loans are generally lower than the rates on unsecured loans. However, when you borrow against your equity you run the risk of foreclosure if you default on the loan, even if you have continued to make the required payments on your first mortgage.

Home Equity Loan

Same as Second Mortgage.

References in periodicals archive ?
Under the new law, for example, interest on a home equity loan used to build an addition to an existing home is typically deductible, while interest on the same loan used to pay personal living expenses, such as credit card debts, is not.
About one in five (21%) homeowners report having a fixed- or variable-rate home equity loan that they are currently paying off.
To the extent that some of the 10 million households obtained cash-out refinances, their demand for home equity loans may not be immediate, but nevertheless many of those borrowers represent future demand.
This division of the market is similar to that for traditional home equity loans.
Home equity loans are popular for a number of reasons.
The interest on this amount is not tax-deductible, as the interest on home equity loans and lines of credit usually is.
To learn more about traditional home equity loans and to relate trends in these closed-end loans to
The eAppraisal tool helps consumers understand the value of a new home purchase or approximate the equity value of their existing home for a home equity loan.
While we hate to turn business away, right now we only offer mortgages and home equity loans in Maryland, Pennsylvania and Delaware," said Dallas R.
Irwin Whole Loan Home Equity Loan Trust, series 2005-A
Loan growth in the consumer sector (defined as 1-4 family residential mortgages, home equity loans, and loans to individuals--including credit card loans) was relatively benign in the fourth quarter of 2005 at 1.

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